A recent study by the Egyptian Centre for Economic Studies (ECES) has identified 14 industrial sectors as Egypt’s top investment and export priorities in the coming years, with a view to directing investment towards activities that generate the highest added value, enhance the competitiveness of the economy, and boost exports.
The study, titled “Industrial Investment Priorities in Egypt and Implementation Challenges”, based its selection of the sectors on the performance of exports, export dynamics and global demand trends, the value added generated by each sector, and their attractiveness to investors both domestically and internationally.
The sectors are engineering and electronics industries; chemical and petrochemical industries; pharmaceutical and medical industries; automotive manufacturing and components; spinning, weaving and ready-made garments; food industries and agricultural products; building materials industries, including cement, glass and ceramics; metal industries, such as iron and aluminum; furniture and wood-based industries; packaging materials; paper and cardboard manufacturing; leather tanning and leather products; handicraft and artisanal industries; and renewable energy and green supplies industries.
According to the study, challenges facing Egypt’s industrial development goals stem from long standing structural issues, including overlapping specialisations among government entities, differing priorities among ministries and institutions, weaknesses in some executive bodies responsible for industrial affairs, and limited financial resources for implementing development plans.
The study noted there are also some emerging challenges, such as the need to strike a balance between policies designed to protect certain strategic industries and the requirements of supporting other sectors, ensuring the availability of serviced industrial land, and strengthening coordination with ministries and entities directly linked to industrial policy, particularly the ministries of electricity, petroleum and environment.
Mohamed Kassem, chairman of the Egyptian Exporters Association, believes that one of the major obstacles to industrial growth is the provision of industrial land at affordable prices, particularly in areas where a labour force is available, such as the governorates of Upper Egypt. Kassem noted that regions with an available workforce should have vocational training centres and industrial hubs in order to achieve development and economic growth.
Khaled Hashem, the minister of industry, announced plans to introduce a new industrial land allocation system based on a “lease-to-own” model. The scheme is intended to ease the initial financial burden on investors, particularly small and medium-sized enterprises, enabling them to start operations without bearing the full cost of land acquisition from the outset, while granting them the right to eventual ownership under specific conditions.
At the end of February, the Ministry of Industry launched the 13th offering of serviced industrial plots on Egypt Industrial Hub, a digital platform. The offering includes 1,272 industrial plots, with a total of 9.78 million square metres in 35 industrial zones in 23 governorates. Plot sizes range from 118 to 400,000 square metres, catering to the needs of small, medium-sized and large-scale investors. The plots are designated for different industrial activities, including food processing, engineering, chemical and pharmaceutical industries, textiles, and building materials. They are located across the Canal cities, the Delta, and several Upper Egyptian governorates, including Assiut, Sohag, Qena, Minya, and Aswan.
Kassem criticised heavy investment in power generation facilities without investment in electricity distribution networks. This, he argued, has resulted in a surplus of electricity generation capacity while industrial zones continue to face inadequate power supply owing to insufficient investment in distribution infrastructure.
He added that the industrial sector’s contribution to the national economy has declined from more than 18 per cent of national income to 12 per cent, a figure he said was “very modest”.
The manufacturing sector excluding petroleum contributed 12.6 per cent of GDP in fiscal year 2024-2025, down from 16 per cent in 2021-2022, being the largest contributor to economic growth.
Former minister of industry Kamel Al-Wazir said that the government aims to increase the industrial sector’s contribution to GDP from 14 per cent to 20 per cent by 2030 and expand green industries to five per cent of GDP.
Hashem said at the ECES seminar that the lack of utilities infrastructure is one of the main obstacles to industrial expansion and the attraction of new investments, given the high cost of establishing electricity networks, sewage systems, and other infrastructure required for industrial zones.
He added that the government is currently implementing plans to upgrade utilities and extend services to under-utilised industrial land and intends to expand the industrial developer model. Hashem pointed out that the approach has proved successful in recent years. The ministry aims to increase the number of industrial developers from the current 11 to around 30.
Ahmed Fikri Abdel-Wahab, managing director and CEO of the Egyptian German Automotive Company, said the government’s move to identify priority industrial sectors was an important development in Egypt’s industrial policy after many years of lacking a clear sectoral vision.
He stated that the automotive industry is among the sectors most capable of transforming Egyptian manufacturing, given its close integration with global value chains and its ability to attract a broad network of feeder industries and related activities.
Abdel-Wahab said that building a competitive automotive industry requires more than simply prioritising the sector. It also necessitates attracting major international companies to establish fully integrated export-oriented manufacturing facilities, in order to place Egypt on the regional and global production map.
The presence of a large international manufacturer with substantial production capacity, he said, would encourage suppliers and feeder industries to invest in the Egyptian market, creating a multiplier effect that would extend across a wide range of industrial sectors.
* A version of this article appears in print in the 25 June, 2026 edition of Al-Ahram Weekly.
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